The claimant worked for the Colorado Department of Revenue from 2006 to 2012. In 2012, the claimant slipped and fell while working, suffering an admitted work injury.
The claimant was placed at Maximum Medical Improvement and assigned a permanent impairment rating by Dr. Olson in April 2013. Respondents filed a Final Admission of Liability, admitting to Dr. Olson’s report. The claimant objected to the Final Admission of Liability; however, a settlement agreement was reached prior to any litigation.
The claimant filed an application for a hearing to reopen her settlement pursuant to C.R.S. § 8-43-303, alleging that the settlement had been obtained through fraud and asserting that her cognitive issues had prevented the claimant from recognizing the alleged fraud. The ALJ found that the claimant failed to prove any fraud nor did she show that she did not understand the settlement agreement when she signed it. The claimant appealed the ALJ’s decision to the Industrial Claim Appeals Office (the Panel), and the Panel affirmed. The claimant then appealed to the Colorado Court of Appeals (the Court).
The Court enumerated the reasons for which the Panel’s decision may be set aside as follows: “when (1) the factual findings are not sufficient to permit appellate review; (2) conflicts in the evidence are not resolved in the record; (3) the findings of fact are not supported by the evidence; (4) the findings of fact do not support the order; or (5) the award or denial of benefits is not supported by applicable law.”
The Court reviewed the claimant’s contention that she did not receive a neuropsychological evaluation describing her cognitive deficits before she entered into the settlement agreement and thus could not detect the fraudulent nature of the agreement. The Court ultimately affirmed the Panel’s decision, stating that the record as follows supported the decision to uphold the settlement agreement.
Under C.R.S. § 8-43-303(1), settlement of a worker’s compensation claim “may be reopened at any time on the ground of fraud or mutual mistake of material fact.”
Previous case law has established that the ALJ has the discretion to determine whether the statutory criteria have been met in determining whether to reopen a prior settlement award. A showing of fraud requires that the claimant must prove that the employer made a false representation of material fact, the employer knew the statement was false, the claimant was ignorant of the false representation, the employer made the false representation with the intention that it be relied upon, and the claimant suffered harm as a result. See Vinton v. Virzi, 2012 CO 10, ¶ 15.
The claimant argued that she did not receive a copy of a neuropsychological evaluation performed by Dr. Mann before the settlement agreement was made. The claimant further alleged that the original evaluation was replaced with an altered copy. The ALJ noted that the MMI report cited Dr. Mann’s report, and the MMI report was attached to the Final Admission of Liability, which was sent to the claimant and her attorney at the time. The ALJ found that this evidence was credible and reasonably inferred that the claimant and her attorney were on notice of Dr. Mann’s report before executing the settlement agreement.
The ALJ also found that the claimant failed to present any credible or persuasive information that Dr. Mann’s original report was replaced by an altered version. As such, the ALJ found that the claimant failed to prove that Respondent-Employer purposely concealed any psychological diagnosis, and the Court found that this finding was supported by the evidence in the record that the decision must be upheld.
Another issue considered was whether the claimant was incompetent to enter into the settlement agreement, a determination that the ALJ may retroactively make based on the evidence on the record. The claimant asserted that her cognitive impairments, as detailed in Dr. Mann’s neuropsychological evaluation, made her incompetent to enter into the settlement agreement. Dr. Mann found that claimant had a “mild,” unspecified “cognitive disorder.” Aside from the claimant’s testimony and Dr. Mann’s report, the claimant did not present any additional evidence, nor did the claimant present any evidence that she could not understand the settlement agreement when she signed it.
The claimant failed to make a connection between her diagnosed cognitive impairment and her ability to understand the settlement agreement and its effect. The Court affirmed the Panel’s order based on the ALJ’s findings of facts and the claimant’s failure to identify any legal error in the ALJ’s determination.
Stough v. Indus. Claim Appeals Office, No. 25CA0759 (Colo. Ct. App. 2025).
Want to know more? Contact Luke Peterson at lpeterson@pollartmiller.com
